Inconsistent Pricing Can Undermine Unique Selling Proposition

Jun 23, 2015

Most business owners can explain explain the unique selling proposition that sets them apart (price, quality, service, etc.). Inconsistent pricing can undermine that USP, and leave a customer with grave doubts .

The photograph at the top of this post shows an eight-year-old boy giving the suspicious sidelong glance to a sign at a tourist attraction - a haunted house. The attraction was using this sign, their "chicken board" to make a claim he simply did not find credible. The claim, part of their unique selling proposition, was that this particular haunted house (one of five in just a few square blocks) was so terrifying that more than one hundred thousand paid visitors had chickened out.

It's important to note that the number may be accurate. He's only eight, and any numbers bigger than one hundred seem huge to him. And it would be very hard for him to appreciate the way that a few chickens each day could accumulate into a huge number over the course of decades. But it's his reaction – the immediate sensation that a marketing claim just didn't feel right – is worth examining.

This haunted house wants to establish their USP – that they are the best in a very competitive market. And by "best" they mean "scariest". To help support that claim they use what is known in marketing circles as social proof in the form of their chicken board. They don't just claim to be the scariest, they attempt to prove it by citing the number of visitors that have chickened out.

Used properly social proof is very effective. We easily dismiss claims from those trying to sell to us. We understand their interests are not our interests, and we easily dismiss most of the claims they make.

Social proof is different. It references the experience of people like us – a source of information we find very credible. McDonalds used social proof in the 1950s with their "over one million served" line. If that many people liked that new burger place then it must be good.

Social media and the peer reviews that power things like Yelp! and Urbanspoon have brought social proof to the forefront, but it has been used for ages. When a car company says that their vehicle was the best-selling vehicle in its class for three straight years they are using social proof. When a commercial for a movie references the fact it is the number one movie at the box office it is using social proof. Billboard music charts and bestselling books lists are more forms of social proof. In each of these cases the behavior of consumers that we identify with is being used to market a product.

Back to the haunted house – if that many other haunted house enthusiasts chickened out then it must be truly scary.

It's a good approach, but the number they use (108,000+) is a problem. It just seems too big. If you do the math it is possible (about twenty chickens a day for fifteen years) but at first glance it seems unlikely. The fact that the claim immediately makes you question the math undermines its credibility. Your immediate reaction is not supposed to be suspicion.

It's easy to cause that same flicker of doubt with pricing. Many sellers want to tick off too many boxes. They want to claim to be both the best and the most affordable.

That tends to make consumers suspicious. It might be true, and as sellers we probably truly believe that our products are the very best and also the most affordable.

But as consumers how often do we really find that to be the case? How often is the best also the cheapest? It's rare enough that we're always going to be skeptical.

Brands that thrive at the high end often reinforce their position by drawing attention to the fact that they are not the cheapest. "We're not the cheapest but we are the best" seems much more credible to a consumer.

It's a little like this famous advertisement:

Admitting to the negative (bad taste) gives them credibility. And it fits in with our view of the world. Rarely is there not some kind of trade-off or compromise. If they said it was the cheapest, best-tasting and most effective remedy we'd dismiss it as too good to be true. But awful tasting and effective? That seems believable – especially coming from a company that just admitted their product tastes terrible.

Trying to be all things to all people is dangerous. Claiming to be the best and the cheapest may well leave people convinced you are neither.

Sponsored by FloristWare – Flower Shop Software

Beyond Cost Plus is sponsored by FloristWare: Fully-featured flower shop software that saves you time and money while increasing sales – without costing you an arm and leg or tying you to a wire service.